It was heartening to read that Ohio House speaker Jon Husted is taking a real leadership position alongside Governor Ted Strickland to propose a renewable energy portfolio standard with yearly benchmarks (and penalties for utilities that don't meet not terribly aggressive yearly goals of .5 percent growth). Not only does Husted's bill call for an "RPS"  to Ohio, but also the creation of a Renewable Energy Authority to collect the fines -- both with an eye toward scaling up the renewable energy industry here. 

WCPN hosted a conversation this morning about Ohio’s energy policy and pending legislation which calls for a Renewable Portfolio Standard (an RPS is generally considered the policy that can most effectively jump start the state’s renewable energy business and which is being threatened in the Senate bill by a lack of benchmarks, i.e. utilities will not be forced to report on their progress toward producing green power until 2025 in the Senate version).

Renewable energy advocates might take heart in House Speaker Jon Husted’s comments that he worries having no benchmarks and promises to not raise rates are at odds with having a renewable portfolio standard in Ohio. Husted promises to resolve the issue in the House bill.

I’d like to correct some misstatements from some callers to this morning’s show. The caller who said that Ohio is a bad state for solar because it’s too cloudy would be pleased to know that Ohio has more solar potential—more sunny days —than the country of Germany, which has the largest global use of PV solar power. "If you look at a map of Germany it looks more like Alaska,” Bill Decker, of Decker Homes said at the Entrepreneurs for Sustainability Solar Challenge.

Also, Erika Weliczko founder and president of REpower Solutions, a local renewable energy provider, figures that 1 MW of solar power is comparable to the energy content of 705 barrels of crude oil. In order for Ohio to produce 1 MW of solar power, the state would only need a little more than 2.2 acres of solar arrays.

On the topic of how renewable energy will impact consumer rates, let’s look at all 24 states that have passed an RPS, not just California (as the gentleman from the chemical lobby suggested, which may not be a good example because of the volatility of that market because of the Enron scandal), and see what impact RPS have had on rates.

One more word about California’s RPS—according to the head of that state's environmental protection agency, the introduction of an RPS will produce billions in customer rebates. While covering the national Solar conference in Cleveland, I wrote:

Much is made here of California’s Million Solar Roofs Initiative, where the state is using its RPS (passed in 2002) to get the ball rolling on a goal of 3,000 megawatts of solar PV installations in ten years. Half of their new homes will have solar panels, and at least 10% will be for lower income. Put in perspective, 350 megawatts serves the needs of 500,000 people, and California has 71 megawatts (101 megawatts is the total U.S.) solar installed. 100 megawatts offsets 191,000 tons of carbon dioxide emissions and takes up 1 square mile.

Money for California’s solar initiative will come from its RPS which is expected to generate $3.2 billion in rate-payer rebates, says Bernadette Del Chiaro, Clean Energy Advocate, Environment California.

If I’m to understand correctly, there are ways of dealing with the short term rate spikes, and one of them is already in place in Ohio.

Back in July 2007, Ohio’s big three investor-owned electric companies—AEP, Duke and First Energy (in that order)—announced they will offer a Renewable Energy Credits program RECs. With ‘RECs’, you and I as rate payers volunteer to pay the premium, which could be as much as a two cents per kilowatt hour, for renewable energy.

If the market (you and me) is willing to fork over a premium for green power, producers should reciprocate and agree to buy a certain percentage of renewables. Akron-based First Energy is already buying green power for its customers in Pennsylvania because the state has an RPS on the books (incidentally, the Keystone State’s RPS lured Gamesa, a Spanish company that makes wind turbines, to open a manufacturing plant in two abandoned steel mills).

How come we’re not hearing more about how RECs will impact on rates while introducing renewable energy in Ohio. When are the utilities doing business in Ohio introducing the program for customers to volunteer to pay premiums for green energy?

Lance Traves, managing principal at Labyrinth Management Group, finds another reason to support Gov. Strickland's energy plan in this week's Crain's Cleveland Business, where he writes:

The current debate on the future of electric utility regulation in Ohio is at a critical crossroads. Simply stated, the right legislative changes today can help secure a prosperous future for Ohio's industrial manufacturing sector while also providing for energy security and enhanced environmental protection.

One component of Gov. Ted Strickland's proposed legislative changes being heavily lobbied against by electric utility companies is the advanced energy portfolio standard. This standard would require utility companies in Ohio to generate at least 25% of their electricity from advanced energy projects by 2025.

Not as well known is that the governor's proposal would allow for up to half of the requirement to be met by electricity from "co-generation" projects and reduce barriers to distributed energy. Co-generation and distributed energy don't have the same wow factor as "green" windmills and solar cells, but they are cost competitive, ready to implement, and could provide a tremendous boost to Ohio's overall economy.

The fact is that Ohio has a vast untapped industrial co-generaton energy portfolio. General Electric estimates that steel-related manufacturing plants in Ohio could co-generate up to 1,000 megawatts of electricity from wast gases and waste heat associated with the operations.

My company estimates that an additional 500 megawatts of electricity could be generated using waste gases and waste heat from other types of industrial plants in Ohio. In total, these industrial co-generation projects could provide electricity to power the equivalent of more than 1 million homes at a loer cost to ratepayers than building new power plants.

Update, 12.6.07
Ohio lawmakers propose expanding drilling in state parklands as part of energy package, the PD reports. So, it looks like drilling for more natural gas in the southeast part of the state, i.e. Wayne County, is being floated as the compromise to include a renewable portfolio standard. At the same time, State Rep. Jim McGregor, a Columbus-area Republican, is proposing Ohio utilities produce 22 percent by 2020 from renewable sources only (instead of just 12%). Is this an acceptable compromise?